Oil surges as hurricane Ida sweeps US refineriesEuropost
Crude oil prices soared on supply concerns as powerful hurricane Ida swept the US Gulf and forced a large number of companies to halt the activity of offshore refineries and urgently evacuate the personnel. On international markets crude oil soared after three weeks of prices slowly rising, Reuters reported. Traders are not certain whether and how many of the platforms are still functional.
Brent has reached $72.54 a barrel in early Monday trading while US oil rose to $68.25 a barrel, having jumped a little over 10% over last week.
The benchmarks hit highs not seen since early August, $73.69 and $69.64, respectively as Ida crossed the coast near Port Fourchon, Louisiana, a hub of the Gulf's offshore energy industry. Oil products, like gasoline and diesel, are likely to see prices rise more acutely from refinery outages, especially if there are difficulties in bringing refineries and pipelines back online. US gasoline prices rose more than 3% at one point as power outages added to refinery closures on the Gulf coast and the focus switched to crude products.
PBF Energy Inc's 190,000 bpd refinery in Chalmette, Louisiana, has been shut down by a power outage caused by Ida, sources told Reuters. Marathon Petroleum Corp shut its 578,000 bpd in Garyville, Louisiana, as the storm approached. Colonial Pipeline operator of the largest petroleum products pipeline in the United States, said it would temporarily halt fuel deliveries from Houston to Greensboro, North Carolina, due to Ida.
On the production side, energy companies had halted more than 95% of crude output, or 1.74 million bpd's worth, in the US Gulf of Mexico, according to the Bureau of Safety and Environmental Enforcement, as Ida headed toward drilling rigs and other infrastructure. The Gulf supplies about 17% of US oil.